Australia Launches Six-Month Trial for Tokenized Asset Markets

The Reserve Bank of Australia (RBA) has initiated a six-month trial, named Project Acacia, to investigate the potential of tokenized asset markets. This endeavor, the second phase of the RBA's digital currency pilot, concentrates on wholesale use cases and involves a broad spectrum of participants, including major banks and local fintechs. The project aims to test 24 innovative use cases, with 19 pilot programs involving real money and asset transactions, and five proof-of-concept trials using simulated transactions.

The trials will encompass a variety of asset classes, including fixed income, private markets, trade receivables, and carbon credits. Proposed settlement assets for the use cases include stablecoins, bank deposit tokens, and a pilot wholesale central bank digital currency (CBDC). These assets will be tested on a range of private and public-permissioned distributed ledger technology (DLT) platforms, such as Hedera, Redbelly Network, R3 Corda, Canvas Connect, and other EVM-compatible networks.

Brad Jones, Assistant Governor (Financial System) of the RBA, underscored the strategic importance of ensuring that Australia's payments and monetary arrangements are fit for the digital age. He noted that Project Acacia provides an opportunity for collaborative exploration between the public and private sectors on tokenized asset markets and the future of money. The use cases selected in this project will help the RBA better understand how innovations in central bank and private digital money, alongside payments infrastructure, might enhance the functioning of wholesale financial markets in Australia.

The Australian Securities and Investment Commission (ASIC) is providing regulatory relief to participants to support and streamline the pilot. The regulatory relief announced will allow these technologies to be tested, exploring opportunities and identifying risks. Project Acacia will facilitate collaboration between industry and regulators to learn more about how these use cases may reshape the financial services industry, potentially boosting efficiency and fostering economic growth.

Key players in this initiative include the Commonwealth Bank, Australia and New Zealand Banking Group, and Westpac Banking Corporation. These entities aim to explore CBDC utility in the repo market. Participants are testing across various Distributed Ledger Technologies (DLTs).

Observers predict the initiative could drive innovations in tokenized assets and enhance liquidity on platforms such as Hedera. Experts foresee broader adoption of digital currencies. Effective advances will depend on collaborative support among central banks, financial institutions, and blockchain technology. Historical CBDC trials suggest potential for increased efficiency and security across financial systems globally.

The trial is expected to run for the next six months, with a report on the findings from the project anticipated to be published in the first quarter of 2026. This initiative marks a significant step forward in Australia's exploration of digital currencies and their potential to innovate asset markets.